About this Show

Mad Money

News/Business. (2012)

NETWORK

DURATION
01:00:00

RATING

SCANNED IN
San Francisco, CA, USA

SOURCE
Comcast Cable

TUNER
Virtual Ch. 58 (CNBC)

VIDEO CODEC
mpeg2video

AUDIO CODEC
ac3

PIXEL WIDTH
528

PIXEL HEIGHT
480

TOPIC FREQUENCY

U.s. 21, Eaton 13, Washington 12, Cooper 10, Florida 8, Cramer 8, Us 5, Ben Bernanke 4, Jason 4, Jim 3, Bernanke 3, Eog 3, Papa 3, United States 3, Kudlow Cramer 3, Bakken 3, North Dakota 3, America 3, Jpmorgan 2, Havertown 2,
Borrow a DVD
of this show
  CNBC    Mad Money    News/Business.  (2012)  

    December 12, 2012
    11:00 - 11:59pm EST  

11:00pm
i'm jim cramer and welcome to my world. >> you need to get in the game. >> firms are going to go out of business and he's nuts! they're nuts! they know nothing! >> i always like to say there's a bull market somewhere. "mad money." you can't afford to miss it. hey, i'm cramer. welcome to "mad money." welcome to cramerica. other people want to make friends. i want to help you make a little money. my job is not just to entertain but i'm trying to teach and coach you. call me at 1-800-743-cnbc.
11:01pm
you can blame the democrats for their inability to offer any cuts to spending. you can blame the republicans for not wanting to even consider tax increases. but don't you dare blame ben bernanke for not being willing to take bold action to get this economy hiring and moving again! even if his statements about economic weakness ultimately cause the averages to stumble from some pretty lofty levels. dow ultimately declining ability 3 points, s & p inching up 4.4%. closing in positive territory. nasdaq giving up .28%. when you look at what ben when you look at what ben bernanke did today you've got to marvel. the republicans themselves refuse to get specific on spending until they see something from the white house. the elected portion of our government is not helping this
11:02pm
economy at all. their failure to rise above politics to reach a compromise is now really starting to hurt the u.s. economy. in this vacuum, the fed has decided to keep rates low. they stepped in saying listen, business, we are not going to get in your way. we're not going to allow interest rates to go higher until we get many hundreds of thousands of people hired! [ applause ] ben bernanke has become the jobs commander in chief. while i've heard nothing but carping on air in the blogosphere as you the fed's latest actions today. i say give me a break. bernanke said my legacy will be that i helped people get a job. and i care more about the unemployed than i do about taxing or not taxing the wealthiest 2%. further, bernanke's implied with this action to keep buying bonds. buy buy buy buy buy buy! to force interest rates to stay low until we get to a 6.5% unemployment. well, he's saying he's very worried about our country going
11:03pm
over the fiscal cliff. and he's extremely anxious about how that newfound mandated austerity will mean huge job losses. yeah. lots and lots of people not being able to pay for dinner. our network calculates that while there'll be some powerful initial debt reduction from the reduced spending and much higher taxes, going over this cliff women cost this country two million jobs. do you ever hear that during the day? two million jobs. a lot of jobs. which is why we believe congress and the president must rise above their stances and compromise to give us a more reasoned way to try to balance the budget. in other words, bernanke like so many of us has given up on washington's ability to govern, at least when it comes to the economy. he knows he's alone in trying to get people hired. he doesn't want to be blamed for what happens when we go over the cliff. he's actually more worried about those who don't have jobs than he is about those who do. put simply, the guy's got a heart. he's not willing to check the heart at washington's door. all right.
11:04pm
come on, this show's about making money, cramer. not a cardiology exam of ben bernanke versus the president and congress. it's the most valuable thing you can do to keep the bull market from running out of steam. as part of a long term analysis of the stock market that i've been working on pretty much every night at home, if you only needed to know one number, one piece of data to predict the direction of the market, you would choose the unemployment rate. when the unemployment rate is going lower and jobs are being created, stocks going up, the positive signs. the congress of course is true, too. sell when people are being fired left and right. now, the problem at the moment isn't with the fed, it's with the executive branch and the legislature. the presidential intransigence as well as no new tax pledge to
11:05pm
grover norquist, republicans won't accept tax hikes to make a deal when spending is the true issue. the president is nothing serious when it comes to spending at all. nothing! so it looks like the cliff jumps ahead of us after my trip to washington. that was a tough day. had to take a couple showers. in return the fed chief has said today listen consumer confidence is already turned down because of the cliff thing. business confidence suddenly turned down. why? because of the cliff thing. he said it had to be related. mike duke, president and ceo of the largest retailer in the world, walmart says it's become the principal concern of his customers. they're happening now. it ain't just us talking. today's selloff after a nice move up caused first by good corporate news, buy backs, decent earnings, then the initial word about how the fed's going to keep rates low, shows you it may be finally dawning on people that there might not be a deal to avoid the fiscal cliff.
11:06pm
although i did hear quite encouraging some of the guys were saying no vacation without legislation. they're getting that part of the game plan. after a week's worth of rally in part driven by hopes that a deal could be made, who can blame people for taking profits when the fed chief takes action, spurred in part because the man who invented the fiscal cliff seems to think the odds are high here we're going over it. there's always a constituency disappointed at any bold action. we heard the fed's actions were reckless, feckless, irresponsible. other concerns that things might be far worse than we think. the fed has given up on any chance that our leaders will rise above this morass. i think bernanke is the only grownup in the whole town. he wants to get a deal to balance the budget longer term in order to get the economy going now. you know he can't do anything to get a deal himself. so he's giving us the best alternative he's got out there
11:07pm
to the ridiculous partisanship and inability to cut entitlement spending. it's all necessary if we're going to have long term organic growth. not from this low interest rates he's creating right now that allow companies to refinance their balance sheets and use some of those gains to put people to work if they have any demand that needs to be met by expansion. can't put people to work if you don't have any demand for your product. what works when the fed does this? we know the sector that's most sensitive, the largest sector that held up all day. housing related plays, banks react terrifically to this kind of news. that's where all the s & p gains were. they remained the best place to go. housing and housing related. while we await some sort of resolution in washington. even if it's a bad one. here's the bottom line. the fed chief has once again given you a green light to buy stocks at least from his perch. i'm proud of this guy, proud he's our fed chief. you're only getting a green light because bernanke thinks the term he created, the fiscal
11:08pm
cliff will now be jumped from. the result might very well be what we on cnbc predict. a gigantic loss of jobs in the name of vicious and yes, totally unnecessary forced march instant austerity. jason in oklahoma, jason. >> caller: hello, mr. cramer. booyah from oklahoma city. >> man, do we ever love oklahoma city. we love oklahoma. i miss it. let's get back down there and do another show. cannot get there sooner enough! go ahead. >> caller: planned asset sales completed by the first quarter of 2013 which will help its balance sheet. on the other hand, with the acquisition of chesapeake's foreign pipeline business, williams company is expanding its pipeline infrastructure. which of these companies do you think has a better outlook in 2013? >> i'm going to have to say williams. aubrey mcclennon said he was going to slim down his company. but he's not necessarily getting
11:09pm
all the best prices. i think williams did well on this deal and i like williams very much. i should be recommending that stock more but i just don't like natural gas. that's why i've been such a demon about eog. let's go to sam in florida. sam. >> caller: good evening, dr. cramer. >> oh, thank you, sunshine. >> caller: booyah to my brother joel in queensbury, new york. >> marquess of queensbury. good fight last weekend. >> caller: could eli lily -- phase three trial until late 2013 delaying approval for their application to u.s. and europe? >> when you started i was thinking he's really going there. always i wanted this to be espn. he's going to ask me about eli manning. no, eli lily. i read through the release many times about the alzheimer's drug. i'm not concerned. i want to pull the trigger on
11:10pm
eli manning and hit it on eli lilly. rob in florida, rob. >> caller: booyah, jim. how you doing? >> real good. how about you? >> caller: good good. my question is about coinstar teaming up with verizon. >> yeah, i know, man. there's a lot of ways to get tv, isn't there? >> caller: yes, sir. >> well, i got to tell you. i'm not a coin star fan. now netflix is out of its mind, you see that stock today? the coin star thing made me a coin flip for coin star but i like verizon. call me conservative. ben to the rescue. after today it seems like he's the only one trying to get the economy rolling. but he can't do it all by himself which is why we need people to rise above and get a deal. almost any deal before it is too late. "mad money" will be right back. >> coming up, fuel up? america's on track to become one of the world's top energy
11:11pm
producers, and eog resources has been leading the way in some of the country's largest finds. can this oily play continue to produce slick gains? cramer drills down in his exclusive with the ceo. and later, overpowering? eaton has been on a role since announcing its acquisition of electrical giant cooper industries. now that the deal is closed can this stock still light up the ticker or is it time to pug the plug? don't miss cramer's exclusive with the ceo all coming up on "mad money." >> don't miss a second of "mad money." follow @jimcramer on twitter. have a question? tweet cramer #madtweets. send jim an e-mail to mad money at cnbc.com. or call us at 1-800-743-cnbc. miss something? head to madmoney.cnbc.com.
11:12pm
i always wait until the last minute. can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery.
11:13pm
as part of a heart healthy diet. that's true. ...but you still have to go to the gym. ♪ the one and only, cheerios
11:14pm
some stories are so powerful they can even transcend the nonstop worries about the fiscal cliff. some stocks can thrive even if our leaders can't come to an
11:15pm
agreement. eog resources, one of the largest and best independent oil companies in america. in recent years we've seen a whole host of natural gas focused firms trying become more oily. eog has succeeded that puts the rest of its peers to shame. it gets 50% of its sales from crude, up from 33% of sales last year. eog isn't totally hostage to the price of crude. beog reported beginning november the company raised its 2012 growth production target for oil and natural gas liquids to 38%. third increase this this year. most of that thanks to eog's huge positions in the bakken and eagle ford shales. incredible production growth. if north america ever gets energy independence we will look back at eog as being responsible for that development. eog has given a nice 14% gain since the last time we spoke with the ceo in may. even though it's a few point off
11:16pm
its high i think it's pretty darn cheap on a growth basis. with a 22% long term growth record, rates you don't usually speak of oil companies like a drug company or like a big industrial growth company but these guys are. let's talk to mark papa, chairman and ceo of eog resources. welcome back to "mad money." >> good afternoon, jim. >> all right. you got a chart in your most recent presentation says u.s. horizontal crude oil growth 2005 to 2012 bakken and eagle ford equal 80% of prudhoe crude oil production. isn't this chart a chart of almost everything that you've done? because how many other companies have your growth in those two fields? >> well, it is true that we're the ones that found those two horizontal plays. and we have the best position and the largest producer in the eagle third and one of the
11:17pm
largest producers in the bakken shale play. we like to think we're the one that kicked off this whole horizontal oil boom in the united states. and turned around the production in the u.s. >> and another page in your tremendous presentation which is probably the most bullish page i've seen in pages in terms of how i feel about the world and i think you do, too. 1920 to 2012, u.s. crude oil production growth you had this being reversed because of horizontal oil success and you were putting us back to where we were in the 1960s in just another couple of years? >> yes. we believe that u.s. oil production entirely due to the horizontal drilling in the shales is going to grow by about two million barrels a day in aggregate for the whole industry over about a four-year period, 2011 through 2015. and that's going to be the largest growth we've seen in a long time.
11:18pm
even today, we're at a peak production that we haven't seen for 15 years in the united states due to this horizontal drilling boom. it's taken us a long way and i believe by 2020 we have a real good chance in the u.s. to be north american oil independent. and fundamentally what that means is we won't be relying on opec oil imports by 2020. we're going to rely on canadian imports plus burgeoning u.s. production. that is a major major change in the united states energy picture. >> now mark, one of the things that i've learned from you is that the numbers that we often see are radically understated. the government will put out numbers. it seems like every time they put out numbers they're well behind. what is the disconnect between the numbers that we see officially and what's really going on in the oil patch? and why don't people realize how
11:19pm
quickly this change is occurring? >> yes. the dynamic of the change is one that's easy to underestimate. in fact, eog has really underestimated the dynamic of the change. we've raised our production growth forecast for oil three times this year. and that's not because we've been coy with wall street. it's really because we've underappreciated the power of some of these plays. you mentioned earlier for example this eagle ford play, we think that just eog's net of oil discovered in the eagle ford is the biggest discovery of oil in the united states since prudhoe bay back in about 1970. that's how powerful that is. and eagle ford over a period of really five years is likely to go from zero to a million barrels a day. that's on a gross basis for everybody in the industry.
11:20pm
for an oil development to go from zero to a million barrels a day over that short period of time, that's kind of like middle eastern standards. >> now, does that need continued high prices worldwide to make it work? how much are these wells -- what is your all in versus what you can sell it at? >> yeah. our all in cost in eagle ford is on a per well basis about $5.5 million per well. the economics are very positive in the eagle ford at current oil prices in the high 80s right now. the important thing is that even though the u.s. is growing oil production, it's being produced into a global oil market. oil is fungible. you can put it in a ship. it's a liquid. ship it all over the world if you want to. unlike the north american gas
11:21pm
market. so the increase in production we're seeing in the u.s. in our opinion is not going to affect global oil prices, unlike what happened in the north american gas market because gas is really nonfungible. it's an island commodity. we found a ton of gas in the u.s. through through horizontal shale drilling and it tanked gas prices in the u.s. >> you have spent a tremendous amount of money on infrastructure to get it from where it is, no one else has, to where it can be sold. isn't that whole infrastructure that you put together the distribution, isn't that in some ways worth the whole price of your darned company? >> oh, i think you're perhaps overvaluing the worth of the infrastructure, jim. but yeah, it's been a sleeper. by definition of infrastructure, a lot of our oil for example is
11:22pm
located in north dakota. >> right. >> and right now if you had to sell your oil in north dakota there's a very severe price discount relative to other locations, particularly along the gulf coast. and so we've got a crude by rail system where we take our north dakota oil and rail car it down to louisiana. and we get a very significant price uplift in the range of about $20 a barrel price uplift. and we were the innovators of this, first in the industry to do this again. and it's given us a huge first mover price advantage. but i wouldn't claim that it's worth the value of the entire market cap of our company. >> okay. i just know a lot of companies are selling these divisions that transport it. one last question. will natural gas prices ever rebound giving in your presentation you say over and over again we keep finding it everywhere. >> yeah.
11:23pm
in terms of when gas prices will rebound, eog is one of the more bearish in terms of gas price forecasts. i believe gas prices will rebound from 2012 price levels which were abnormally low, but i think we're going to be kind of stuck in a channel of between $4 and $5 gas prices for the next oh, the next five to eight years, which is not that good for producers but it's excellent for the u.s. economy because it means we're going to be the country that has the lowest long term natural gas prices of any industrialized area. to just put that in scale for your viewers, in the u.s. we're going to have a gas price of between $4 and $5 per 1,000 cubic feet. in the far east that same equivalent gas price is going to be more like $15.
11:24pm
in europe that gas price is going to be about $9. so chemical industries, fertilizer industries, energy intensive industries are going to flock to the u.s. and help with an industrial revolution, i believe, over the next decade in the u.s. because of low natural gas prices. that's going to be great for the u.s. economy. >> thank you for all you've done to make the continent more energy independent. i thank you for being on the show, mark papa. >> thank you, jim. >> okay. that's mark papa, the chairman and ceo of eog resources. this man has found more oil for his shareholders than any other company i follow which is why it's been a great producer for not just oil but also for profits in the stock market. i'll try to make you more money. coming up, overpowering? eaton's been on a roll since announcing acquisition of cooper industries. now that the deal is closed can this stock still light up the
11:25pm
ticker? or is it time to pull the plug? don't miss cramer's exclusive with the ceo.
11:26pm
11:27pm
lately the industrials have been coming back with a vengeance. today we got news of a host of industrials. big mines, reporting much better
11:28pm
than expected future quarters, even though this was just okay. cummins, truck engine company announced a billion dollar buy back. dupont surprisingly bullish global gdp forecast for 2013. the fact we like the tide turning for this cohort, we tend to own the stocks of best in breed companies that can do well even those tide is going against them. companies that are taking con stroll of their own destiny. eden. edtn. hydraulics, truck transmissions, aerospace, components. number or two in virtually everything they compete with. one of the main reasons i back eaton is it announced a $13 billion purchase of cooper industries. gives them a lot more exposure to electrical equipment,
11:29pm
utilities, in dire grade of upgrading the networks after sandy. eaton is best in the electrical space. they've done 28 deals since 1990. cooper is the largest of them all by far. we just spoke to eaton's fabulous ceo on october 31st. since then the stock has rallied nearly $5 or 10.5%. i think actually it has a lot more room to run given all the positives from the cooper deal are just getting done. let's check in with sandy cutler the ceo of eaton. welcome back to "mad money." >> good evening, jim. best wishes for the holidays. >> same to you. same to you. i think your company now is just an electric and power management company with other businesses. the reason i put it like that is because that is one of the fastest-growing businesses in the world, electrical power management. while the others are still important, i think that the growth of the company is this new-formed division. am i reading it too close to
11:30pm
cooper and not enough to the vast panoply of your company? >> we still think the whole broad array of businesses we have that are all profiting from this global trend of increasingly efficient use of energy is still the big game for eaton. no question the cooper acquisition means about 60% of our revenue using 2011 pro formas will be in electrical. about another 20% in aerospace and hydraulics. about 80% of the business in those newer businesses for eaton. >> when i look at cooper i see terrific clients. you've got chevron, conoco, alcoa, honeywell, pge, duke, texas utilities. how much of cooper's business is brand-new business for eaton that you've never been in that will be fabulous for you to sell into going forward? >> all the product basically that cooper is involved in are complementary to ours. that's one of the unique things about this transaction, virtually no overlap from a
11:31pm
product point of view. but the oil and gas, utility are areas where we bring the strength of two companies together. now can provide a more integrated solution for our customers. there's a lot of potential in that area. so pleased we closed the deal on november 30th. now we get down to the process of managing the two companies as one. >> 1% to 2% gdp growth in this company can still do incredibly well next year? >> i think we only have to look at the third quarter this year to get that answer. if we look at the slowing gdp in the u.s., where it really was not a spectacular quarter, our earnings and america's business were up over 30%. our earnings and our rest of world business were up over 20%. the cooper eps was up 18%. i think that gives you a feel for how important this whole trend toward more efficiency, having a grid that really works well, and bringing those kind of electrical solutions to our customers. it is a really powerful trend. >> now, we heard from the fed chairman today that he doesn't think that growth either domestically or worldwide will be that great.
11:32pm
i know he's concerned about construction because construction puts a lot of people to work. you've got a lot of leverage now. a direct play on nonresidential construction with cooper. do you have too much leverage to construction given what you see in the buildings going forward? >> actually one of the things we like about the cooper deal, jim, if you recall our original base electrical business with eaton was about 40% nonresidential construction, about 10% residential, about 30% power quality and the balance was in both utility and the industrial side. cooper brings big vertical end markets in oil and gas, in industrial, in utility. so we actually end up with even a better balanced array across the economy. we think that's another great reason for investors to be interested in our company. >> now i'm trying to get a handle. when i went through the presentations one thing was very clear. you've always been the most transparent company i deal with in the industrial sector. next quarter will be hard for me to understand, to put in context.
11:33pm
you've got earnings and another kind of earnings. how i do measure the company? i'm so used to you just putting out earnings per share. i look at what people are looking for, i look at what you do. seems like next quarter will be messy no matter what. >> there's no question. we tried to speak to this in our third quarter guidance. three months of eaton base operation, one month of cooper. a number of the transaction and accounting costs is going to make a messy quarter if you will in pulling that apart. i think what's important for investors to look at in our fourth quarter is going to be how are markets trending. you may recall global markets were down some 1%. still electrical markets were positive within that for us. we had forecast that we thought the end of this year the economy here in the u.s. and around the world would continue to slow. first quarter would probably be slow and we might see growth on the order of 2% to 3% in our end markets next year. that of course is up a little bit from the 1% to 2% this year. i think the important issues to watch here in the fourth quarter is how do the markets actually react through this time period. will they be as we think? then of course the big action
11:34pm
going down on washington this week and next is can we find a principled compromise that's going to allow us to avoid the fiscal cliff? and if that's true, we think that's not only good for the u.s. economy, we also think that's positive for the global economy. >> have you weighed in in washington? did the leaders know your view on things? >> yeah, i think you saw that at the business round table that i participated in that group there was a lot of coverage of it the last day or two. the position we've taken in borrowing your byline, this is a time for legislation, not for vacation. and it is critical that we get this compromise done. it's not about declaring winners and losers, it's about finding a solution for the united states which is good for employees and is good for retirees. it's good for investment and takes care of the unemployed. that can be done. we've done this before. we believe that we need to all bring our pressure and our support to our elected officials to get that deal done before year end. >> do you think that there's any real commitment to cutting spending by the president?
11:35pm
>> i believe that all the parties involved in this transaction, and as you pointed it's a multiparty transaction, want to find a solution. and i'm personally optimistic that can be done because i believe the individual elements are there of a principled compromise today. but it is going to require that everyone give up something to make all this come together. and i'm not speaking about any one element of either the budget reductions or the revenue raises. it's going to require both. we support very much many of the studies that have been done that suggested a ratio of maybe three parts expense to one part revenue. but i don't want to get ahead of the negotiations. the people who need to negotiate these are our elected officials. and we need to support them in finding this compromise. >> if everybody had your attitude i think that we'd have a deal and we'd have a deal within the next few days. a fantastic job doing so well at a time when we have no growth. who knows what happens when we really get some? thank you so much for coming on "mad money." >> jim, thanks very much. >> this is a great company. and the combination is
11:36pm
unbelievable for 2013. when we look at what's going to be unbelievable for our charitable trust we think eaton. this is going to be one of the best stocks of 2013. stay with cramer. >> coming up, are you ready to get charged up? cramer cranks up the voltage and goes electric on an all new hyperactive lightning round.
11:37pm
11:38pm
11:39pm
it is time. it's time for the lightning round. play this sound and then the lightning round is over. are you ready? the lightning round. scott in florida, scott. >> caller: hey, jim, thanks for having me on today. >> my pleasure. >> caller: so i'm wondering about a couple of the casinos such as mgm and caesar's that seem to be making efforts. >> you want to buy mgm but lay off caesar's. mgm is doing a lot of things right.
11:40pm
caesar i don't like that balance sheet. jason in massachusetts. >> caller: hey jim, this one has kind of run up some. but a lot of the big money's buying it. colfax corporation? cfx? >> it has been pitching like koufax. it's the only heating, ventilating, air conditioning stock that is really doing well. i'm going to ride with strength here. do not forget, ingersoll rand on the one being split up. john in new mexico. >> caller: hey, jim, a big chickenhat.com from booyah. >> what's going on? >> caller: listen i'm dying to get back into china. it looks like bidu is leaving without me. can i jump back in? >> man come on, we need to diversify when we play china. which is why my charitable trust which you can follow along with actionalertsplus.com is buying the ishares trust, the fxi. buy buy buy. goes to 42.
11:41pm
go to eddie in florida. a lot of florida calls. >> caller: hello, jim, a big booyah from port st. lucie, florida. thanks for all the help you've given me over the years. i wish you continued good health. >> very kind. what's going on there? >> caller: okay. i own precision drilling, pbs, a long time. do i continue to own it or sell it? >> i'm a big quality guy. if you're going to be in that drilling game you want to be in schlumberger, alias slob. best in in breed. no one ever did wrong by going best im breed. mike in illinois. >> caller: booyah, mr. cramer. >> what's going on? >> caller: merry christmas to your and your staff. listen, what's this mass welcome the biomed, admd? >> i wish i knew. without talking to the ceo directly on the show i can't make heads or tails of what is really going on with that company.
11:42pm
i did that once with this quest corp. i need more information. i would like mr. weber to come back on the show so we can get some questions answered, abmd. lets go to jason in minnesota. >> caller: dana holding corps, symbol dan. sell what i got or buy more? >> i don't care -- i prefer dana from homeland more than i like dana holdings right now. i do think if you want automotive, i am willing to bless for you. i know that's radical. i've been staying away from ford. but dana holdings had a very big move. we're going to schnitzel that one. go to paul in florida. >> caller: hi, jim, it's paul down here in jupiter, florida. i'm calling today about bgc partners? >> unbelievably bad. unbelievably bad. had the ceo on. what can i tell you? i am not going to be qualitative. i'm just saying the stock has been unbelievably bad.
11:43pm
and wow. not much more to say. and that, ladies and gentlemen, is the conclusion of the lightning round. >> the lightning round is sponsored by td ameritrade. coming up, waiting for washington to rise above? get your portfolio prepared for whatever happens. call, tweet or e-mail and find your way to the latest edition of "am i diversified?" she also likes to ride her bike. she knows the potential for making or losing money can pop up anytime. that's why she trades with the leader in mobile trading. so she's always ready to take action, no matter how wily... or weird... or wonderfully the market's behaving... which isn't rocket science. it's just common sense. from td ameritrade.
11:44pm
it's just common sense. people have doubts about taking aspirin for pain. but they haven't experienced
11:45pm
extra strength bayer advanced aspirin. in fact, in a recent survey, 95% of people who tried it agreed that it relieved their headache fast. visit fastreliefchallenge.com today for a special trial offer. as part of a heart healthy diet. that's true. ...but you still have to go to the gym. ♪ the one and only, cheerios
11:46pm
that makes tv even better. if your tv were a prom queen, zeebox would be a stretch limo. just like a limo helps make a prom queen's night special, zeebox turns watching tv into a party with friends by letting you connect, share and chat about all your favorite shows. download zeebox free, and have the night of your life with your tv. what do we do if they don't come up with a deal in washington? we know we could have serious deficit reduction if they don't. that's what the cliff jump's really about. it could be at a cost of gut wrenching austerity. that's why we play am i diversified every week to get you through tough times with a balanced approach, including stocks that might do well if we go over the cliff. this is where you call me or tweet me @jimcramer. tell me your top five holdings and i tell you if you're diversified enough. we're starting with a tweet
11:47pm
tonight from @hobbies x who says "i only invest in stocks with single letter ticker symbols". alphabetical diversification? my top five are c for citi group, d for -- am i diversified #madtweets. look, whatever makes you happy. if it's picking stocks that have single letters as long as you're diversified this part of the exercise, they'll be okay. let's go over. ford, okay. bad paper cut. it's not getting better. i have to use this finger. okay. ford is an auto company. macy's a retailer. dominion a utility. u.s. steel is industrial.
11:48pm
citi is a bank. retailer, utility. bingo. that's perfect. that's what we want to see. let's go to ob in pennsylvania. ob. >> caller: hey, jim, big booyah from havertown, pa. >> i got relatives there. what's shaking? >> caller: not much. how you doing? my index finger is killing me. >> caller: i go back to the kudlow cramer days with you when kudlow cramer days with you when kudlow cramer days with you when i was a novice investor , and all your knowledge that you pass onto us i became a pretty good investor. thank you. >> oh, you're terrific. philadelphians. we're going to stick together. we're going to defeat the bengals. that's a whole other topic. >> caller: you ready for my big five? >> you bet i am. >> diagio, deo, disney dis, express scripts, pxrx. jpmorgan, jpm, and matrix sme mtrx. am i diversified with this portfolio, jim? >> all right, mr. havertown let's get on this. let's see. we have an oil and gas services
11:49pm
company with matrix. we've got a diversified entertainment company that i think is going to go right back to 52 with disney. we have a spirits company with diageo. jpmorgan, one of the best banks. jamie dimon. express scripts which is a health care company, pharmacy benefit manager. health care, bank, spirits, oil service, entertainment, bingo. philadelphians rock. let's go to tony in missouri. >> caller: booyah to you from st. louis. i would just like to say and take this time to wish you and your family along with your dedicated staff a very merry christmas and a prosperous, healthy and safe new year. jim, you're truly one-of-a-kind and your knowledge is by far second to none. >> right back at you. when you see tonight's show you'll realize i have a very small head but i am wearing a st. louis cardinals hat. so go ahead. >> caller: they'll be back here. 2013, baby. >> i agree with you.
11:50pm
>> caller: jim my portfolio reads like this. abbott labs, abg, w.p. carey, wpc, northern tier energy, nti, sand ridge mississippian trust number two, sdr, and phillips 66 pfx. with your help and your blessing i'll take note, jim. >> you're okay. you're okay. you're okay. i just want to check something here. because let me see. stay with me for one second. i just want to be sure this is a real estate investment trust that i like. yeah. okay. all right. wp carey is one of the least backed real estate investment trusts. i wish they'd come on the show. i'd love to hear from them. sandridge, northern tier and phillips 66, more st. louis rams like than cardinals.
11:51pm
rams have good d when they're home, and a drug company. three oils, phillips 66, we're going to put industrial. why don't we do eaton? we're going to take sandridge out but we need income. let's get income from tanger. great interview today with steve tanger in the "new york times." that will get you where you have to go. please do that. way too overweighted in oil. sometimes what we suffer from
11:52pm
is bigger than we think ... like the flu. with aches, fever and chills- the flu's a really big deal. so why treat it like it's a little cold? there's something that works differently than over-the-counter remedies. prescription tamiflu attacks the flu virus at its source. so don't wait. call your doctor right away. tamiflu is prescription medicine for treating the flu in adults and children one year and older whose flu symptoms started within the last two days. before taking tamiflu tell your doctor if you're pregnant, nursing. have serious health conditions, or take other medicines. if you develop an allergic reaction, a severe rash, or signs of unusual behavior, stop taking tamiflu and call your doctor immediately. children and adolescents in particular may be at an increased risk of seizures, confusion or abnormal behavior. the most common side effects are mild to moderate nausea and vomiting. the flu comes on fast, so ask your doctor about tamiflu. prescription for flu.
11:53pm
secondhand smoke affects everyone's health. it's not just irritating. it can cause heart disease and even death. speak up about secondhand smoke. your health and the health of your family depend on it.
11:54pm
time for an important public service announcement. history is not fungible or ideological. it's not an abstraction. that's exactly what's happening right now when people talk about the origins of the bull market that coincided with the clinton era. the one that started in 1992 and continued until 2000, when the dow powered from 3200 to 11,000. let's get our facts straight. first the move did happen. i don't want any dow deniers out there. there seem to be plenty of clinton haters around who would like to believe the rally didn't even occur. well, occur it did. of course the discussion right now centers on what happens to the stock market if we go back to the clinton era tax rates. most democrats say the raises did not hurt the stock market back then but because deficit and interest rates went down it
11:55pm
helped the stock market. most republicans want to ignore that analysis entirely or say the rally occurred because of the internet explosion and that's what drove prices higher. others say the rally occurred only because we had gridlock in washington during the so-called republican revolution. first, let me say i lived through that era. it was when my old hedge fund was ascendent and i studied the bull market endlessly. i consider myself a pretty astute examiner of the period in question. notice that the dow more than tripled. i didn't talk about the bull market in the nasdaq. the internet played a major role in that overheated index. you could asterisk that but you can't asterisk the dow. third, i know this is real heresy. but other than the bull market in bonds that ended up lowering interest rates and supply of bonds, i think washington really mattered much less back then than people in this politically charged era are willing to admit or remember or maybe learn about. you didn't sit there every minute and obsess about washington as we do now.
11:56pm
sure we had a moment where clinton bashed the drug companies. they got hammered but they snapped right back due to merger activity. a peace dividend from the end of the cold war end was minor compared to the overall earnings from the expansion in our companies overseas. dominance. the greatest thing about the bull market in the 90s washington didn't matter at all. all the griping about how democrats wreaked havoc on business. benign time. white house was -- [ inaudible ] tons of new job creation from all parts of the private sector. big, small, everywhere. that propelled the stock market all the way. in short my conclusion about the clinton era is that the genesis and substance of the bull market came from corporate profits and the hiring it bred once the government stayed on a certain and predictable course. tax rates just weren't much of a factor in the decision making of business. definitely not as much as the certainty of knowing what they were and what they would be when the treasury secretary from goldman sachs, bob reuben in his
11:57pm
prime and knew how to stay out of the market and get involved only in the debacle in mexico, intervened. enough of the washington obsession. it was about corporations spewing cash as it expanded its base. get that to happen again and you can bet the clinton era bull market will be repeated. stay with cramer.
11:58pm
boproductivity up, costs down, thtime to market reduced... those are good things. upstairs, they will see fantasy. not fantasy... logistics. ups came in, analyzed our supply chain, inventory systems... ups? ups. not fantasy? who would have thought? i did. we did, bob. we did. got it.
11:59pm
why they have a raise your rate cd. tonight our guest, thomas sargent. nobel laureate in economics, and one of the most cited economists in the world. professor sargent, can you tell me what cd rates will be in two years? no. if he can't, no one can. that's why ally has a raise your rate cd.